Raising City Kids 8 States Where You Can Save the Most Money

Urban living has a lot to offer families. A shorter commute for working parents, access to city museums, parks and zoos and greater diversity are just some of the reasons why parents forgo the perks of suburban life. But being in the center of it all typically comes with a large price tag - that gets even bigger once you have kids. And in many cases, families are forced out of the city and in to the ï ¿ ½burbs because of the high cost. Yet a recent study from childcare experts Care.com and real estate website Zillow found 10 cities (in eight states) where it actually costs less for a family to live in the city than it does to live in its respective suburbs. The study took median home prices, property taxes and costs of childcare into account when determining costs of living. But thereï ¿ ½s also future college costs to think about. Itï ¿ ½s important to keep your housing and childcare expenses manageable so that you have enough leftover to save. Your childï ¿ ½s four-year degree could end up costing well over six figures, so itï ¿ ½s a good idea to start putting money away in a 529 college savings plan as early as possible. 529 plans are the most effective way for families to build substantial college savings. Investments grow tax-free and are not taxed as long as you withdraw the funds to pay for qualified higher education expenses. And while you can invest in almost any plan, no matter where you live, your home state may offer additional state tax benefits for residents. Tax breaks like these allow you to keep (and save!) more of your money. Hint: Six states on this list offer tax deductions for residents who use 529 plans. If you want your kids to grow up in an urban environment, but still have room for college savings in your budget, check out the slideshow for some frugal alternatives. California City: San Diego Cost savings relative to living in the suburbs: $4,555 529 plan option: > The Scholarshare College Savings Plan Plan Details Photo credit: La Jolla Mom Arizona City: Phoenix Cost savings relative to living in the suburbs: $6,567 529 state tax benefit: Contributions to Arizona and non-Arizona 529 plans of up to $2,000 per year ($4,000 for married couples filing jointly), are deductible in computing Arizona taxable income. 529 plan options: > Arizona Family College Savings Program Enroll Now > Fidelity Arizona College Savings Plan Enroll Now > FIND A 529 PRO NOW Photo credit: North Central News Rhode Island City: Providence Cost savings relative to living in the suburbs: $6,974 529 state tax benefit: Contributions to the Rhode Island 529 plan of up to $500 per year by an individual, and up to $1,000 per year by married taxpayers filing jointly are deductible in computing Rhode Island taxable income, with an unlimited carry forward of excess contributions.ï ¿ ½Contribution deadline is December 31. 529 plan options: > CollegeBound Saver (Direct-Sold) Enroll Now > FIND A 529 PRO NOW Photo credit: KiDOinfo Nevada City: Las Vegas Cost savings relative to living in the suburbs: $7,318 529 plan options: > Nevada Prepaid Tuition Program > SSGA Upromise 529 Plan > The Vanguard 529 Savings Plan > USAA 529 College Savings Plan > FIND A 529 PRO NOW >Wealthfront 529 College Savings Plan Photo credit: Town Square Las Vegas Wisconsin City: Milwaukee Cost savings relative to living in the suburbs: $8,227 529 state tax benefit: Contributions to a Wisconsin 529 plan of up to $3,100 per beneficiary per year (any filing status) are deductible in computing Wisconsin taxable income.ï ¿ ½Contribution deadline is April 15 of the year following the tax year. 529 plan option: > Edvest Plan Details Photo credit: Mommypoppins.com Ohio Cities: Cincinnati Cost savings relative to living in the suburbs: $5,514 Cleveland Cost savings relative to living in the suburbs: $9,034 529 state tax benefit: Contributions, including rollover contributions, to a Ohio 529 plan of up to $2,000 per beneficiary per year (any filing status) are deductible in computing Ohio taxable income, with an unlimited carryforward of excess contributions. Contribution deadline is December 30. 529 plan options: > Ohio CollegeAdvantage Direct 529 Savings Plan -- Enroll Now > FIND A 529 PRO NOW Photo credit: Cincinnatiusa.com Maryland City: Baltimore Cost savings relative to living in the suburbs: $10,790 529 state tax benefits: Contributions to the Maryland College Investment Plan of up to $2,500 per beneficiary per year by an individual, and up to $5,000 per beneficiary per year by married taxpayers who each make contributions to their own accounts, are deductible in computing Maryland taxable income, with a 10-year carryforward of excess contributions. Contribution deadline is December 31 postmark. 529 plan options: > Maryland 529 ï ¿ ½ College Investment Plan > Maryland 529 ï ¿ ½ Prepaid College Trust Photo credit: Cruises on the Bay Pennsylvania Cities: Pittsburgh Cost savings relative to living in the suburbs: $4,258 Philadelphia Cost saving relative to living in the suburbs: $13,849 529 state tax benefit: Contributions to Pennsylvania AND non-Pennsylvania 529 plans of up to the gift-tax annual exclusion amount ($14,000 in 2016) per beneficiary are deductible in computing Pennsylvania taxable income. Spouses filing jointly must each have at least $14,000 in income to claim the maximum $28,000 per-beneficiary deduction.ï ¿ ½ 529 plan options: > Pennsylvania Guaranteed Savings Plan > Pennsylvania 529 Investment Plan Photo credit: MiniTime Urban living has a lot to offer families. A shorter commute for working parents, access to city museums, parks and zoos and greater diversity are just some of the reasons why parents forgo the perks of suburban life. But being in the center of it all typically comes with a large price tag - that gets even bigger once you have kids. And in many cases, families are forced out of the city and in to the ï ¿ ½burbs because of the high cost. Yet a recent study from childcare experts Care.com and real estate website Zillow found 10 cities (in eight states) where it actually costs less for a family to live in the city than it does to live in its respective suburbs. The study took median home prices, property taxes and costs of childcare into account when determining costs of living. But thereï ¿ ½s also future college costs to think about. Itï ¿ ½s important to keep your housing and childcare expenses manageable so that you have enough leftover to save. Your childï ¿ ½s four-year degree could end up costing well over six figures, so itï ¿ ½s a good idea to start putting money away in a 529 college savings plan as early as possible. 529 plans are the most effective way for families to build substantial college savings. Investments grow tax-free and are not taxed as long as you withdraw the funds to pay for qualified higher education expenses. And while you can invest in almost any plan, no matter where you live, your home state may offer additional state tax benefits for residents. Tax breaks like these allow you to keep (and save!) more of your money. Hint: Six states on this list offer tax deductions for residents who use 529 plans. If you want your kids to grow up in an urban environment, but still have room for college savings in your budget, check out the slideshow for some frugal alternatives. California City: San Diego Cost savings relative to living in the suburbs: $4,555 529 plan option: > The Scholarshare College Savings Plan Plan Details Photo credit: La Jolla Mom Arizona City: Phoenix Cost savings relative to living in the suburbs: $6,567 529 state tax benefit: Contributions to Arizona and non-Arizona 529 plans of up to $2,000 per year ($4,000 for married couples filing jointly), are deductible in computing Arizona taxable income. 529 plan options: > Arizona Family College Savings Program Enroll Now > Fidelity Arizona College Savings Plan Enroll Now > FIND A 529 PRO NOW Photo credit: North Central News Rhode Island City: Providence Cost savings relative to living in the suburbs: $6,974 529 state tax benefit: Contributions to the Rhode Island 529 plan of up to $500 per year by an individual, and up to $1,000 per year by married taxpayers filing jointly are deductible in computing Rhode Island taxable income, with an unlimited carry forward of excess contributions.ï ¿ ½Contribution deadline is December 31. 529 plan options: > CollegeBound Saver (Direct-Sold) Enroll Now > FIND A 529 PRO NOW Photo credit: KiDOinfo Nevada City: Las Vegas Cost savings relative to living in the suburbs: $7,318 529 plan options: > Nevada Prepaid Tuition Program > SSGA Upromise 529 Plan > The Vanguard 529 Savings Plan > USAA 529 College Savings Plan > FIND A 529 PRO NOW >Wealthfront 529 College Savings Plan Photo credit: Town Square Las Vegas Wisconsin City: Milwaukee Cost savings relative to living in the suburbs: $8,227 529 state tax benefit: Contributions to a Wisconsin 529 plan of up to $3,100 per beneficiary per year (any filing status) are deductible in computing Wisconsin taxable income.ï ¿ ½Contribution deadline is April 15 of the year following the tax year. 529 plan option: > Edvest Plan Details Photo credit: Mommypoppins.com Ohio Cities: Cincinnati Cost savings relative to living in the suburbs: $5,514 Cleveland Cost savings relative to living in the suburbs: $9,034 529 state tax benefit: Contributions, including rollover contributions, to a Ohio 529 plan of up to $2,000 per beneficiary per year (any filing status) are deductible in computing Ohio taxable income, with an unlimited carryforward of excess contributions. Contribution deadline is December 30. 529 plan options: > Ohio CollegeAdvantage Direct 529 Savings Plan -- Enroll Now > FIND A 529 PRO NOW Photo credit: Cincinnatiusa.com Maryland City: Baltimore Cost savings relative to living in the suburbs: $10,790 529 state tax benefits: Contributions to the Maryland College Investment Plan of up to $2,500 per beneficiary per year by an individual, and up to $5,000 per beneficiary per year by married taxpayers who each make contributions to their own accounts, are deductible in computing Maryland taxable income, with a 10-year carryforward of excess contributions. Contribution deadline is December 31 postmark. 529 plan options: > Maryland 529 ï ¿ ½ College Investment Plan > Maryland 529 ï ¿ ½ Prepaid College Trust Photo credit: Cruises on the Bay Pennsylvania Cities: Pittsburgh Cost savings relative to living in the suburbs: $4,258 Philadelphia Cost saving relative to living in the suburbs: $13,849 529 state tax benefit: Contributions to Pennsylvania AND non-Pennsylvania 529 plans of up to the gift-tax annual exclusion amount ($14,000 in 2016) per beneficiary are deductible in computing Pennsylvania taxable income. Spouses filing jointly must each have at least $14,000 in income to claim the maximum $28,000 per-beneficiary deduction.ï ¿ ½ 529 plan options: > Pennsylvania Guaranteed Savings Plan > Pennsylvania 529 Investment Plan Photo credit: MiniTime